KLOFFE'S KLSE CI Futures Weekly Market Commentary

MARKET MOVEMENT

The Kuala Lumpur Composite Index Futures (FKLI) was traded from a high of 735 to a low of 648.1, a difference of 86.9 index points. The week started off on a negative note when the merger talk between RHB group and Commerce Asset Holding has been called off. The February futures contract was pulled down in the low of the week and settled at 648.5.

However, the strong support line of 643 was not broken when the ringgit was showing some strength on Tuesday. The futures market swing upwards to close at 680, still 11 points discount with the cash market.

Since Wednesday, the February futures has been trading at premium when ringgit was at a stable level at 3.52/3.94.Furthermore, rumours of re-negotiation of Commerce Assets-RHB and 1.3% increase in Forex reserves sent the futures market to close at 734, a premium of 5.94 points.

Total contracts traded for the week were 15,199 contracts, an daily average of 3,040 contracts. Total open interest stayed above13,000 level.

MARKET OUTLOOK

Next week would be the last week of February and we would anticipate huge rolling over activities. February contract would be push up and March contract would be pull down caused by the rolling overs.

Resistance would be shown at 742, 751, and 776 while support would be at 676, 701, 717 levels. Cash market is expected to be trading between 695 and 745. I believed that the futures market would be reacting on the forex movement and probably Daim's news media meeting on the coming Tuesday.

High liquidity and massive intraday movement is expected on next week's trading.

DISCLAIMER
The weekly market commentary has been compiled by Shu, Meng Chan (article writer) for private views only. The weekly market commentary articles are being released for the interest of Shu, Meng Chan only and should not be considered investment advice. There is no warranty or representation expressed or implied by Shu, Meng Chan as to the the accuracy or completeness of the commentary herein. The content of the articles will not reflect the general view point of the described (KLOFFE)Futures Exchange. Shu, Meng Chan will not be liable for any action taken by viewers upon reading Shu's Corner KLOFFE's Weekly Market Commentary.

(mshu@tm.net.my)
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